Employers should leverage ACO networks for better performance

Narrow networks are back in vogue with health plans, trying desperately to offer a lower cost product. A narrow network focused on maximizing discounts by partnering with limited providers is likely to fail in the long run.

For employers, this discussion needs to move away from ‘narrow’ to more about a care delivery model that provides the highest value and most efficient performance to their employees.

Such high performance networks (HPN) should combine desired market coverage with member focused care delivery models, and provide a strong foundation to move the needle on cost and quality.

Accountable care organizations (ACOs) are quickly evolving as HPNs that employers should explore. ACO is a health care system that partners with employer (or other payers and TPA) to develop a model that aligns financial interests with delivery of effective and quality care for specific population.

Why is it important?

No health plan can consistently deliver on cost, quality and experience if it does not have an aligned provider network. Traditional fee for service delivery system (such as PPO), is not aligned with employer or employee’s needs. The results of such misalignment is there for everyone to see.

A true ACO on the other hand can be aligned with employer’s specific interests and values, its geography, and provider, service, payment preferences etc.

What about multi-location employers?

If you have employees working in multiple locations, you may find it challenging to partner with each ACO separately. In that case, you may explore partnerships with a TPA that provide a layered network on top of these ACOs to deliver consistent quality and experience to employees dispersed over wide geographies.

What will be different?

Data Sharing

Since ACO technology foundation is based on sharing data between providers, employers will get more real-time data about claims, admissions, readmissions etc.

Better Member experience

The member experience is likely to significantly improved, since employers can influence clinical and operational processes based on their specific needs.

Care Coordination

ACO provide care coordination across entire spectrum of care. This will lower costs, and provide better member satisfaction.

Goals and Metrics

With this model, you can create goals and metrics that will define and measure success. These metrics include HEDIS, Star Ratings or other custom criteria defined by employers.

It is time for employers to explore plans built on high performance ACO based networks. Contrary to traditional PPO plans, this will provide you a health care delivery system that aligns all parties’ financial interests, clinical processes and operations to deliver cost effective, quality care around a commonly accepted set of goals for improved results.